Macy’s
Careers at Macy’s
Mission
Macy’s mission is to provide a personalized merchandise offering and shopping experience.
History
Rowland Macy had a bad track record. He had made four attempts to launch dry goods stores, all of which had failed. In 1858 he made another try, opening R.H. Macy & Co. in midtown Manhattan. Learning from his mistakes, he instituted a cash-only policy for customers and himself – no inventory was bought on credit. He also provided a wide range of products, from towels to clocks to jewelry.
The store was much further north than most dry goods retailers at the time, located on Sixth Avenue and 14th Street. However, it generated much attention thanks to Rowland’s strong promotional instincts. On its first day it experienced significant sales, and by the end of the year its performance made it a bona fide success. By 1870, annual revenues shot past $1 million.
The company capitalized on its success by expanding into neighboring properties, launching more departments, and employing publicity tactics such as themed exhibits, illuminated window displays, and a store Santa Claus. It also built an onsite factory through which it provided made-to-measure clothing for men and women, and instituted a money-back guarantee.
The company’s ownership stayed in Rowland’s family until 1895, when it was acquired by the Straus brothers, who had a license to sell chinaware and other goods at the store. By 1887 the category generated 20% of its sales. In 1902, the flagship location moved further north to 34th Street and Broadway. Its presence grew so rapidly that its buildings eventually took over the whole block.
In 1994 Federated Department Stores pursued a merger with the company. It was completed at the end of the year. Over the next decade Federated converted several of its retail chains to Macy’s stores, to the point that the chain had 424 stores in the U.S. by 2005. In 2007 Federated changed its corporate name to Macy’s Group. It now operates under the Macy’s and Bloomingdale’s nameplates.
Benefits at Macy’s
Business model of Macy’s
Customer Segments
Macy’s has a mass market business model, with no significant differentiation between customer segments. The company targets all consumers who desire general merchandise.
Value Proposition
Macy’s offers three primary value propositions: accessibility, convenience, and brand/status.
The company creates accessibility by providing a wide variety of options. Its selection includes a broad range of merchandise, including home furnishings, cosmetics, apparel and accessories (men’s, women’s, and children’s), and other consumer goods.
The company offers convenience by making life simpler for customers. Most of its stores are located at suburban or urban sites, typically in densely populated locations, where more people can access them. Also, it enables customers to buy items online and pick them up in store the same day.
The company has established a powerful brand due to its success. It is the largest department store in the United States in terms of retail sales. It generated annual revenues of $27.1 billion in 2015 and has 157,900 employees. As of April 2016 it had 880 stores in 45 states, the District of Columbia, Guam, and Puerto Rico under the brand names of Macy’s, Macy’s Backstage, Bloomingdale’s, Bloomingdale’s Outlet, and Bluemercury.
Channels
Macy’s main channel is its network of retail stores located across the U.S.; it also sells products through its website. The company promotes its offering through its social media pages, advertising, and participation in trade shows and conferences.
Customer Relationships
Macy’s customer relationship is primarily of a self-service nature. Customers utilize its products while having limited interaction with employees.
Key Activities
Macy’s business model entails distributing products and delivering associated services to customers.
Key Partners
Macy’s key partners are the suppliers that provide it with the merchandise it sells in its stores. No suppliers accounted for more than 5% of its net purchases in 2015. It also maintains important partnerships with the manufacturers that produce items for its private label collection.
Key Resources
Macy’s main resources are its physical resources, namely its collection of 880 stores in 45 U.S. states and other locations. Among these, 426 are owned and 318 are leased. It also maintains important human resources in the form of full-time and part-time store associates that offer customer support.
Cost Structure
Macy’s has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions. Its biggest cost driver is cost of sales, a variable expense. Other major drivers are in the areas of sales/marketing and administration, both fixed costs.
Revenue Streams
Macy’s has one revenue stream: revenues it generates from sales of its products to customers.
